JH v Legal Complaints Review Officer

[2014] NZHC 3089

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2014-404-1353 [2014] NZHC 3089

IN THE MATTER

of an application for review under the

Judicature Amendment Act 1972 of the decisions of the Legal Complaints Review Officer pursuant to ss 193 and 206(4) of the Lawyers & Conveyancing Act 2006 in LCRO 232/2012

BETWEEN

JH Applicant

AND

THE LEGAL COMPLAINTS REVIEW OFFICER

First Respondent

KENNETH RAYMOND DANIELS Second Respondent

NEW ZEALAND LAW SOCIETY Third Respondent

Hearing:	13 October and 4 December 2014
Counsel:	PJ Wright and HE McQueen for applicant PN Collins for third respondent
Judgment:	4 December 2014

(ORAL) JUDGMENT OF FAIRE J

Solicitors:           Vallant Hooker & Partners, Auckland (M Vallant) New Zealand Law Society, Wellington, (C Walker)

JH v The Legal Complaints Review Officer [2014] NZHC 3089 [4 December 2014]

The application

[1] The applicant applies to judicially review decisions of the Legal Complaints Review Officer (“LCRO”), dated 25 March 2014 and 8 May 2014. The first decision upheld a decision of a Standards Committee given under the Lawyers and Conveyancers Act 2006. The effect of the first decision is to hold the applicant in breach of r 12.2 of the Lawyers & Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008.

[2]      Rule 12.2 provides:

12.2Where a lawyer instructs a third party on behalf of a client to render services in the absence of an arrangement to the contrary, the lawyer is personally responsible for payment of the third party's fees, costs, and expenses

[3]      The  first  respondent  has  filed  an  appearance  reserving  rights,  but  has otherwise indicated that the first respondent will abide the decision of the Court.  A development  occurred  which  Mr  Collins  has  confirmed  today  that  there  is  no intention to depart from the result in paragraph 4 of the consent memorandum.

[4]      The second respondent’s position is that he does not wish to be involved and regards the matter as solely a dispute between the applicant and the first respondent. That position has been confirmed by his counsel in a memorandum filed for the purposes of this conference.

[5]      When reviewing this file on 17 July 2014, Cooper J was concerned that there were would be no contradictor before the Court on what might be a significant issue concerning  the proper interpretation  and  application  of r 12.2.    Because of that concern, he directed that the proceedings be served on the New Zealand Law Society to ascertain whether the Society would wish to have any involvement in the proceeding.   That occurred.   Counsel was duly instructed on the part of the New Zealand Law Society and a statement of defence and other steps were then taken on the third respondent’s behalf.

[6]      A hearing was convened before me on 13 October 2014.   In the course of argument I raised an issue concerning the vires of r 12.2.  As a consequence, and after discussing the matter with counsel I issued a minute as follows:

[2]       The reason for the adjournment was that counsel needed specific time to consider whether an amendment to the application would be made to raise a question as to the vires of r 12.2 of the Lawyers & Conveyancing Act (Lawyers: Conduct and Client and Care Rules)

2008.

[3]       At  my  suggestion  counsel  have  conferred  and  now  agree  on  a timetable to progress the matter.   Based on counsel’s agreement I order, by consent, in terms of paragraphs 1 to 5 of counsel’s consent memorandum of 14 October 2014.

[4]       The Registrar shall allocate a ½-day fixture on the first available date after 25 March 2015.  By consent, orders are made in terms of paragraph 6(a), (b) and (c) of counsel’s consent memorandum in relation to the filing of submissions and preparation of bundles.

[5]      As the matter is part-heard, the fixture shall be allocated in front of me.

[7]     Counsel for the applicant and the third respondent has filed a consent memorandum. The operative parts of which are as follows:

1.The   Third   Respondent   does   not   oppose   the   judicial   review application.

2.The parties agree that the proper reading of Rule 12.2 requires to be read as referring to the third parties “reasonable or proper fees costs and expenses”.

3.They agree that the rule is concerned with lawyers’ conduct and their liability to ensure third parties are paid a fair and reasonable fee in the absence of an agreement contrary.  The means by which a lawyer should satisfactorily address his or her responsibilities, in circumstances such as those arising on the facts of this case, is for the lawyer to determine in a diligent and professional manner.  The failure  to  do  so,  amounting to  a  breach  of the  rule,  could  have adverse professional consequences.

4.Subject to notice to the other parties and their response as set out at paragraph 6 below, the Applicant therefore seeks an order quashing both of the LCRO’s decisions (ie both as to breach of r 12.2 and as to name publication), not referring the matter back to the LCRO and staying further pursuit of the complaint.

5.The Third Respondent has no standing to agree to or make any concessions or admissions on behalf of the First and Second Respondents.

[8]      I  convened  a  conference  with  counsel  because  there  appeared  to  me  to possibly be a conflict in the position that had been advanced on behalf of the first respondent.  I am satisfied that there is in essence no such conflict because the first respondent does not specifically oppose or seek to be heard on the form of order which is proposed in paragraph 4 of the consent memorandum.   That is understandable because the facts that were inquired into did not specifically inquire into  the  issue  of  the  reasonableness  of  the  fee  which  was  the  subject  of  the complaint.

Orders

[9]      I am satisfied therefore that the orders sought in paragraph 4 of the consent memorandum by the applicant and not opposed by the third respondent are appropriate in this case.  Accordingly, I order quashing the LCRO decision, ie both as to breach of r 12.2 and as to name publication.   I order that the matter be not referred back to the LCRO and stay further pursuit of the complaint.

[10]     As a result of the orders made in this judgment, the fixture which I reserved in my minute of 17 October 2014 and which has been notified by the Registry for

1 April 2015 is vacated and attendances are excused.

Costs

[11]     I reserve costs as between the applicant and second respondent.  In respect of other parties no orders are sought.

JA Faire J